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Glassnode: A new storm is coming to the cryptocurrency market.

Relevance up to 13:00 2022-03-23 UTC–4

Over the past day, bitcoin has risen in price by 1.5 thousand dollars. However, this upward movement of cryptocurrency now means practically nothing. We have already talked about the side channel, which is currently limited to the levels of $ 34,267 and $ 45,408. It is in this side channel that the price has been trading for 2.5 months. At this time, the quotes of the “bitcoin” tend to the upper limit of this channel, but until there is a consolidation above it, it is not necessary to count on a stronger growth of bitcoin.

We also said earlier that the fundamental background for bitcoin remains extremely negative. Today, analysts at Glassnode said that they expect an increase in volatility and sharp price fluctuations in the near future. According to them, the implied volatility exceeded the 60-70% corridor, which may be a harbinger of a new strong movement. Previously, a similar situation was observed in May 2021, when bitcoin began its collapse to the level of $ 29,000.

Earlier, Glassnode stated that they expect a “final capitulation” from short-term traders. According to them, many short-term traders are now at a loss and the longer bitcoin costs less than their expectations, the higher the probability of a new round of cryptocurrency coin sales. Recall that small and short-term traders still make up a significant part of the market. At least, one that can influence the course movement. Short-term traders, as it is easy to guess from the name itself, do not expect to keep bitcoin on their wallets for many years. Therefore, they can arrange a new collapse of the price.

Recall that we have been expecting bitcoin to fall to $ 31,100 for several months. From our point of view, the “bullish” trend is over and now bitcoin, in its best traditions, should lose up to $ 80-90 of its value, if we count from its absolute highs. The geopolitical factor only initially supported the “bitcoin”, but after a couple of weeks, it became clear that BTC would not be able to get more expensive on this factor alone for a long time. Jerome Powell announced yesterday that the Fed is not only ready to raise the key rate at every meeting this year, but also at some meetings it may raise it by 0.5% at once. That is, the “hawkish” rhetoric of the Fed and Jerome Powell personally has tightened even more. From our point of view, it is still a fairly calm and stable time for bitcoin. What will happen in a year when the key rate is likely to be brought up to 2.5%? Therefore, we now suggest traders focus on the level of $ 45,408. If the bulls somehow manage to overcome it, then digital gold may become more expensive for some time, but even the most optimistic experts are not waiting for a new bullish trend right now.

On the 24-hour timeframe, the quotes of the “bitcoin” have not managed to overcome the level of $ 45,408 and continue to be inside the side channel of $ 34,267 – $ 45,408. If one of the boundaries is overcome, then we will get a new trend for the next few weeks. However, this has not happened in the last 2.5 months, so bitcoin should be traded now on lower timeframes according to local trends.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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